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Written by Amy Beardsley
Federal law requires lenders to wait until you’re more than 120 days past due on a mortgage before starting a foreclosure. But depending on the state, foreclosure proceedings could begin after 90 to 180 days.
Don’t lose hope if you’re facing foreclosure and wondering when it’s too late to stop it from happening. You might be able to stop a foreclosure and stay in your house or sell it. Our guide breaks down when it’s too late to stop foreclosure – and when you still have options.
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🗓 When is it too late to stop foreclosure?
The foreclosure process could start as soon as you miss one payment, but most lenders won’t start foreclosure until you fall 90–180 days behind on mortgage payments. You’ll get a formal notice and information about options to catch up on your loan.
Foreclosure timeline: First 90 days
If you’re behind on payments, your lender may agree to a payment plan option that would help you to get out of preforeclosure.
There is often a grace period to get caught up on payments. But a foreclosure defense attorney might be able to negotiate a payment plan to get caught up if a homeowner is outside of that time frame.”
— Mathew Kerbis, founder of Subscription Attorney
Foreclosure timeline: Next 60+ days
The lender’s attorney or trustee will:
- File foreclosure documents in court
- Receive necessary approvals
- Schedule the sale and set your house for a foreclosure auction.
The time from when you get notice and the auction happens varies, but it can be as soon as two to three months.
How to avoid a foreclosure
If you’re facing foreclosure, or even if your mortgage is in forbearance, you can still take steps you can take to stop it.
| If you want to move… | If you want to stay in your home… |
|---|---|
| » Sell to a cash home buyer | » Modify your loan |
| » Sell on the open market | » Get a deed in lieu |
| » Short sale | » File for bankruptcy |
The foreclosure rules for lenders are uniform, but they are state-specific. In states like New York and New Jersey that are more consumer-friendly, the foreclosure process can take years. But states like Texas and Tennessee are more lender-friendly, so the foreclosure process can happen much more quickly, maybe in just a matter of months.”
— Mike Hardy, Managing Partner at Churchill Mortgage, a lender based in San Dimas, CA
Getting specific advice from a local real estate attorney is crucial.
Sell to a cash home buyer
Selling to a cash buyer could get you out of foreclosure in as little as one to two weeks. Allow for one to two months before the foreclosure date, however, since closing with a cash buyer could come with delays.
Companies that buy houses for cash purchase homes in financial distress or “as is,” with no inspections, appraisals, or contingencies. You’ll sacrifice profit, but it’s worth getting cash out of the sale rather than losing your home to the bank.
Connect with a Clever agent to compare cash offers from home buyers in your market.
Sell on the open market
A traditional home sale helps you maximize profits to put you in the best financial position. Start to finish, it can take two to three months, or more.
Selling could be a good choice if you’ve missed a payment (or two) and have time to spare, but it may not be possible if you face foreclosure soon.
The process can take a while and can be tedious. You’ll want to work with a real estate agent to get your home listed. The agent can also manage showings and negotiate offers from interested buyers.
Short sale
It can be a better solution if you don’t have enough equity to sell in a traditional sale or to a cash buyer. Plus, short sales impact a homeowner’s credit score much less than foreclosures, so you’ll be in a better position to find a place to rent or apply for a mortgage down the road.
A short sale is the sale of a home for less than what the owner owes on it. Essentially, you come up “short” when paying off the balance. Keep in mind that the sale is subject to the lender’s approval, and the process can be long and drawn out.
Modify your loan terms
If you want to stay in your home, a loan modification could let you repay your outstanding mortgage balance before foreclosure proceedings begin.
Contact your mortgage company directly to discuss making monthly payments more affordable. Here are some tips on how to get a mortgage modification from Experian:
- Contact your lender to explain the reasons for your difficulty.
- Show proof of financial hardship (divorce, long-term illness or disability, death of a spouse, or sudden rise in housing costs).
- Gather financial documents (tax returns, pay stubs, and bank or investment account statements).
- Apply for the modification in writing.
» MORE: Free mortgage help from the Consumer Financial Protection Bureau
Get a deed in lieu of foreclosure
If you can’t sell your home through a traditional sale or cash buyer, the lender may agree to a deed in lieu: avoiding foreclosure proceedings in exchange for you giving up legal ownership of the home.
Your home needs to be in good condition, however. Lenders may not agree to a deed in lieu of foreclosure if the house is in poor condition or the fair market value has gone down.
File for bankruptcy
If all else fails and you run out of options, you might consider filing for Chapter 7 or Chapter 13 bankruptcy.
Bankruptcy is the most immediate way to stop a foreclosure. While this is not optimal, filing bankruptcy initiates ‘automatic stay,’ which is an injunction prohibiting the lender from foreclosing on the property.”
— Fran Haasch, Founding Attorney and Plaintiff Personal Injury Attorney at Fran Haasch Law Group
- Chapter 7 bankruptcy can delay foreclosure for 3–4 months, even if the lender has already scheduled a foreclosure sale.
- Chapter 13 bankruptcy could let you work out a 3–5 year payment plan — but you’d need to have enough money to make up what you owe and keep up with the mortgage payments.
Bankruptcy can stay on your credit report for 10 years and have lasting financial impacts, so talk with a real estate attorney before going down this road.
FAQs
How many missed payments does it take before foreclosure begins?
The foreclosure process timeline usually begins once you’re 90 days behind on payments and can last several years. There is no set timeline for foreclosures. It depends on the state and the circumstances that led to the foreclosure.
How can you stall or stop the foreclosure process?
The best option to slow or stop foreclosure is to talk with your lender. Let them know you’re struggling to make payments and work through your options. You can also contact a local real estate attorney or HUD-approved housing counselor for help, or sell your home fast to cash in your home equity.
Can foreclosure be stopped after it begins?
In most cases, the answer is yes. Speaking to a local real estate attorney for specific advice is crucial.
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